China surprises with best export growth since March, imports fall from freemexy's blog

China surprises with best export growth since March, imports fall

China's exports unexpectedly returned to growth in July on improved global demand despite escalating trade pressures from the United States, but the rebound may be short-lived as Washington prepares to slap even more tariffs on Chinese goods.To get more chinese daily news online, you can visit shine news official website.

Analysts say a sharp drop in China's yuan currency this week may offer only limited help for Chinese exporters, who are facing additional US levies next month, shrinking profit margins and sputtering demand worldwide.

July exports rose 3.3 percent from a year earlier, the fastest since March and more than the most optimistic had estimated in a poll by Reuters news agency, customs data showed on Thursday. Analysts had expected a 2 percent drop after a 1.3 percent fall in June.

Imports, however, remained weak, declining 5.6 percent and highlighting sluggish domestic demand as China's economy struggles to get back on firmer footing. Still, the drop was less than an expected 8.3 percent and June's 7.3 percent.

The better-than-expected trade readings helped buoy Asian stock markets, which suffered a heavy selloff earlier in the week as the Sino-US trade war intensified and the yuan skidded to 11-year lows.

While China's exports to the US continued to shrink in July in the face of stiffer tariffs, shipments picked up to Europe, South Korea, Taiwan and - most noticeably - Southeast Asia.

"It could suggest that some exporters are trying to diversify their export regions, it could also be due to manufacturers' relocations to ASEAN (from China)," Betty Wang, a senior China economist at ANZ, an Australian multinational banking and financial services company, told Reuters.

"This hopefully can offset some of the downside risks from the US-China bilateral trade."

Washington is clearly watching shifts in China's trade patterns as the trade dispute wears on. The US recently warned Hanoi that some export goods labelled "Made in Vietnam" were of Chinese origin.

An official Chinese think-tank attributed the rise in exports partly to Beijing's Belt and Road Initiative, a programme that aims to boost business and trade ties with dozens of countries across the world.

"This year, China did not only increase its market share in major economies such as the European Union, what's more outstanding is the growth rate in emerging markets is very clear, especially the countries who we work with on the Belt and Road," Yan Min, the director of the forecasting department at the State Information Center, was quoted by Chinese state media as saying.

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